Should Blockbuster call it quits?

[Woochifer]

Whatever it actually was in practice, it was seen as a store telling people what they could and could not watch. If as you say, the "back room" accounted for as much as 1/2 the revenue of mom & pop rental places, then it was probably also decision that cost them. This is not to say that BB didn't address other customer needs like widescreen, but that's a different topic, I think.

In some parts of the country, Blockbuster putting in a "backroom" would cost them a lot more revenue than they'd gain. It has nothing to do with "telling people what they could and could not watch." It has to do with what kind of environment they want to convey to THEIR customers. As I said, EVERY store makes editorial decisions on what they carry, and what they don't carry. If you have a problem with Blockbuster's editorial decisions, then you're free to rent from a store more in line with what you'd rather have.

They made a deliberate decision that they wanted their stores to be "family friendly" and having a porno room in the back detracts from that. Even while living in San Francisco (supposedly this outpost of rampant hedonism and anti-chain store sentiment), I knew of parents that would go to Blockbuster rather than the neighborhood video store because they did not want their kids around the unrated and porn titles. Even my wife felt uncomfortable renting from the video store closest to our house because she'd end up standing in line with a bunch of guys holding stacks of porn titles.

People who'd rather have unrated choices in their viewing can simply choose a different video store. Blockbuster's exclusions had the net effect of keeping a lot of these indie stores afloat, so what's so bad about that?

And how is this any different than HBO choosing not to show adult movies on their network, while Showtime does choose to show them?

Despite their shelves full of new releases, there were many times when these were just the cases, and the actual movies were rented out. I'm going to guess that this was actually an irritation to many people, to see shelves of the same movie cases, but not a single available title to rent.

Plenty of titles, just not the ones that someone might be looking for. Since they no longer have the revenue sharing arrangements with the studios, Blockbuster now stocks fewer copies of new releases than before. Their stores obviously haven't adapted to the changing landscape.

I've read this complaint in many places online, but those people I know that have Netflix don't really seem to find this an issue. It eventually comes, so they don't mind waiting a few extra days. I think this complaint is over-blown.

It's a very real complaint for people who primarily watch new releases and box office hits. They generally don't stay with Netflix for very long. People who don't have an issue with this, like I said, are the ones who have very long queue lists.

With downloads (i.e. unlimitted digital copies available), this will become much less of a problem. Granted, bandwidth on new release nights might be stressed, but that can be addressed technologically. Downloads, regardless of quality, should continue to eat away at physical disk rentals for the simple fact that people who really want to see the latest, will place a preference for the disk in the queue, and barring that will settle for the download.

Downloads are practically a non-entity right now, and even with very small revenue levels to start with, downloading still can't keep up with the growth rate for Blu-ray. The tech-obsessed crowd gushing about video downloads just can't comprehend that most consumers don't want to hook up a PC to their TV or buy an extra set-top box that requires an internet connection. Bandwidth is not the issue, the separation between the TV and the internet connection that exists in the majority of households is a huge issue. This is not a big deal for either of us, but remember that the VHS format rode off into the sunset with the majority of households still not knowing how to set the clock on a VCR. Home networking is a little bit more complicated than that.

I wasn't necessarily speaking in terms of revenue, but more in terms of movies downloaded. Hulu is growing extremely fast and the ads, at least for now, are not very intrusive. Yes, the lion's share of its downloads are TV, but once people get used to it, they'll start expecting movies the same way, and eventually new releases. It's just too easy and it's free. I think they are the biggest threat to Netflix as well as Tivo.

People content with watching TV shows on their computer remains a very limited audience. Hulu is beside themselves because they get a few thousand page views, yet even the lowest rated network programs have audiences in the millions for every episode. This is no different than the wishful thinking that accompanies the small numbers associated with video downloading. If anything, Hulu's merely NBC Universal's way of further fragmenting an already balkanized landscape of downloading, on demand, and PPV options -- all of which require different devices, run different platforms, and have different DRM and payment policies.

Broadcasting and optical media are easy for consumers to understand, with unified standards, interoperability between devices, and content ubiquity (i.e., you don't need separate tuners for ABC and NBC, and you don't need different disc players for Warner and Disney movies). The downloading and on-demand market are nowhere near this state right now, and if anything, the landscape has gotten progressively messier as studios like NBC Universal dump iTunes in favor of starting up their own streaming service.

[Groundbeef]

[i]...you may now resume trolling with Pix

And you may continue to make statements about a service you have never used, seen, or heard of before this discusson began. I'd say you are more like Pix.

As I've used all the services in question (Blu-Ray, HD-DVD, DVD, DVD Ripping, NetFlix Streaming, XBOX Live MarketPlace D/l [SD and HD], Streaming off my computer onto my TV), I'd say I'm pretty comfortable making opinions about all above.

But hey, opinons are like a**holes. Where apparently you are pulling yours from. Have a nice day.

[Kevio]

Without going to the trouble of doing the comparisons myself, I'm just trying to figure out whether it is possible to get the same quality from a download (labeled HD or otherwise) as you get from a standard definition DVD. I think it is a question sort of relevant to this thread. I haven't made any conclusions, just asked questions, did some math. Chill out.

[Groundbeef]

Without going to the trouble of doing the comparisons myself, I'm just trying to figure out whether it is possible to get the same quality from a download (labeled HD or otherwise) as you get from a standard definition DVD. I think it is a question sort of relevant to this thread. I haven't made any conclusions, just asked questions, did some math. Chill out.

On a pixel-pixel "comparison" the quality will never be equal per-se. However, on the visual side, depending upon the source, compression etc, it can be from "crappy" to quite good.

Netflix d/l "streams" look like crap on my TV. On a 15" monitor, it is acceptable. On a
50" plasma it is sh*t.

The HD or SD d/l from Microsoft, although not of the same size as a DVD, are excellent. The audio options are limited, but picture quality is excellent.

As I have said several times. For a HD purist, it is not "equal". For evaluation purposes (ie, do I really want to own this movies) it is an excellent way to evaluate a movie. I have not seen any ghosting/pixelation/or other digital noise relating to compression issues.

Math isn't all of it. On paper, you may not think it will be a good picture. You would need to actually view playback to make an accurate opinion on the quality.

As far as chilling out, I am. Suggesting someone is trolling like Pix doesn't help your case.

[Auricauricle]

It's nice being blinder than a bat with astygmatism. I just get a pait of glasses that is slightly off my recommended strength. The image is just off enough to trick me into thinking the image is "perfect".

[pixelthis]

You ARE a fvcking dumbass, you dumbass. The way you present your opinions, and that's all they are idiot, the way you think you're rubbing people's noses in your mind chilling predictions with your childish *I told you so* attitude when in actuality nobody really gives a rats ass what you think, is why you get the responses you do. DUMBASS.

Yeah, we know you're only joking. So am I dumbass.

THE difference is I am joking.
YOU, on the other hand, are a joke.
And too "dumb" to know it.
PROMOTING a company that takes decent ideas and turns them into mediocre
CRAP SQUARED.
OH, and you spelled "farting" wrong(thats a "joke", BTW)

[Rich-n-Texas]

In a matter of two sentences you contradicted yourself.

There's a book called "How to Win Friends and influence People" by Dale Carnegie. You should read it sometime. Maybe it'll open your eyes and then you'll realize why I call you... DUMBASS.

[pixelthis]

In a matter of two sentences you contradicted yourself.

There's a book called "How to Win Friends and influence People" by Dale Carnegie. You should read it sometime. Maybe it'll open your eyes and then you'll realize why I call you... DUMBASS.

You certainly havent read it.
Thats one of the first new age type books, BTW.
meanwhile you need to read anything by Ayn Rand, harry brown, Milton Freeman,
etc.
Then you might understand why I quit trying to "win" friends long ago.
A friend such as yourself would be no prize.

[nightflier]

Wooch, I wasn't talking about the backroom at the video store. I was referring to the fact that BB was not carrying movies that every other rental place was. It presented an image that they were censoring, whether that was real or just something the bean counters decided they could do, it doesn't change the possibility that this did hurt their bottom line. I remember reading quite a few magazine articles about it, so it seems to have been a general sentiment in many circles. Perhaps a few overly-protective parents may have found comfort in this, but I think that more renters did not. However you look at it, BB is seriously struggling now, so any move that could have hurt their bottom line should have been avoided.

I also think the growth of downloads and streaming content shouldn't be downplayed either. As I've made the case before, it's about creating a culture of people who are familiar and comfortable with it. Right now, that means offering free content, mostly TV shows and older movies, but once the interface and convenience is entrenched enough, this will grow to the major box-office releases. Face-it, this is really the fastest and most efficient way to get new movies to people - no physical disk distributing can be as fast. If the technology improves enough to support DVD sound and audio quality, that will be the watershed. It's just a prediction, but I'm willing to stand by it.

And I'm certainly not talking about putting a computer in the living room, even though that's also becoming more of a regular thing. I mentioned Hulu because of it's phenomenal growth (a lot more than a few thousand hits, BTW). Yes, it's primarily a computer interface, but once it becomes a feature on a manufacturer's set-top box, it should grow very fast. For example, one of the most popular hacks on the internet is to configure an AppleTV box to run Hulu. I imagine that the xBox and PS2/3 hacks are just as easy. The way I see it, there is either going to be a company that is going to integrate a Hulu-type service in the firmware of its box/player, or you'll soon be able to use it on any box/player that can run a web browser.

In either case, it's a market segment that is growing very fast, maybe not in revenue, but certainly in popularity. The fact is, Hulu is the type of service that offers free content, and an increasingly large library of content. If this content bridges the gap from the computer to the TV, it will be very hard for other for-fee services like Tivo and NetFlix to compete. As far as new movies, it's only a matter of time. Maybe it will be a two-tier service where the new content will be subscription-based, but the free service is a lot more attractive, easy to use, and fast than what any of the competitors are offering right now for free.

And if Hulu isn't the one to do it, there will be someone else to take its place. If there's one thing that Hulu's growth does demonstrate is that there's a demand for this type of service.

[Woochifer]

Wooch, I wasn't talking about the backroom at the video store. I was referring to the fact that BB was not carrying movies that every other rental place was. It presented an image that they were censoring, whether that was real or just something the bean counters decided they could do, it doesn't change the possibility that this did hurt their bottom line. I remember reading quite a few magazine articles about it, so it seems to have been a general sentiment in many circles. Perhaps a few overly-protective parents may have found comfort in this, but I think that more renters did not. However you look at it, BB is seriously struggling now, so any move that could have hurt their bottom line should have been avoided.

There is no such thing as a movie "that every other rental place" carries. Name a title that EVERY other video store carries that Blockbuster purposely excludes. You're using a strawman argument to accuse Blockbuster of censorship, which is not what they do.

Some people accuse them of censorship because they don't carry the "unrated" versions of movies. But, how is this censorship if the R-rated version that Blockbuster does carry is the actual theatrical cut?

The only actual example of censorship that I can cite is the video stores that carry so-called safe play DVDs -- DVDs that are specially encoded with skip stops that work on certain DVD players to edit out certain types of content.

Like I said, EVERY video store exercises editorial discretion in picking which titles they carry and which ones they don't. Aside from wide studio releases, there's no such thing as a title that every video store carries.

I also think the growth of downloads and streaming content shouldn't be downplayed either. As I've made the case before, it's about creating a culture of people who are familiar and comfortable with it. Right now, that means offering free content, mostly TV shows and older movies, but once the interface and convenience is entrenched enough, this will grow to the major box-office releases. Face-it, this is really the fastest and most efficient way to get new movies to people - no physical disk distributing can be as fast. If the technology improves enough to support DVD sound and audio quality, that will be the watershed. It's just a prediction, but I'm willing to stand by it.

Of course downloads can be downplayed given that their current revenue growth continues to lag the supposedly outmoded physical format of Blu-ray, and Blu-ray's revenue surpassed downloads and all PPV combined a long time ago.

Free content is just that, free. Major box office releases going out over the internet for free? Right.

And I'm certainly not talking about putting a computer in the living room, even though that's also becoming more of a regular thing. I mentioned Hulu because of it's phenomenal growth (a lot more than a few thousand hits, BTW). Yes, it's primarily a computer interface, but once it becomes a feature on a manufacturer's set-top box, it should grow very fast. For example, one of the most popular hacks on the internet is to configure an AppleTV box to run Hulu. I imagine that the xBox and PS2/3 hacks are just as easy. The way I see it, there is either going to be a company that is going to integrate a Hulu-type service in the firmware of its box/player, or you'll soon be able to use it on any box/player that can run a web browser.

And how many Apple TV owners hack their boxes to run Hulu? Your hypotheticals are ridiculous because the majority of people who buy set top boxes just want those things to work. They're not interested in hacking or programming or even knowing any of the technical details under the hood. If most households couldn't figure out how to program a VCR clock, then how do you expect them to start hacking the firmware on set top boxes?

The audience for streaming services is ridiculously minute compared to the size of the audience for broadcast services. So long as you have a landscape where the set top boxes have balkanized standards and access to programming, it will remain a niche for those thousands (as opposed to the millions who watch broadcast and optical media) willing to put up with all the hoops one needs to jump through. If all of this hodgepodge of different formats, pricing structures, and studio entanglements can be sorted out so that all of these devices can play or one device can play them, then I can see things shifting in a more profound way. But, that hasn't happened, and probably won't anytime soon.

In either case, it's a market segment that is growing very fast, maybe not in revenue, but certainly in popularity. The fact is, Hulu is the type of service that offers free content, and an increasingly large library of content. If this content bridges the gap from the computer to the TV, it will be very hard for other for-fee services like Tivo and NetFlix to compete. As far as new movies, it's only a matter of time. Maybe it will be a two-tier service where the new content will be subscription-based, but the free service is a lot more attractive, easy to use, and fast than what any of the competitors are offering right now for free.

Hulu is primarily a rebroadcasting venue for NBC Universal. Those programs are already bought and paid for by advertisers.

New movies? Are you claiming that the studios will put movies out onto the internet for free, before it goes into theaters, before it goes on sale on DVD/BD, before it gets sold for PPV services, before it gets broadcast on premium cable services? You mean, NBC Universal is going to produce a $100 million movie out and release it in such a that they cut out all of their most lucrative revenue sources in the process?

[nightflier]

Wooch, I'm saying that movies will have commercials. It's going to take some special arrangement to get this going for new releases, but Hulu is already showing older movies this way.

As far as the AppleTV setup, it's actually just a software install. But I think what's much more likely to make all happen is when set-top boxes, players, DVRs, and cable boxes can run a web browser without restrictions. That's just around the corner and is going to change this whole discussion.

I'm also not calling BR an outmoded physical technology. BR is very succesful right now, and that's just fine, it is what it is. What I am saying is that downloads and online streaming are much more popular than sales figures would suggest. With online content, it's much more about quantity than value, and that's an equation that lends itself much better to an advertising-driven business model, even if that's not to my liking (which it isn't), but it is what it is.

[Mr Peabody]

My first thought is the internet has always been about getting stuff for free, downloads. But when the music industry crushed Napster, there did evolve a host of service providers for paying customers. Not to say there still isn't plenty of illegal downloads of music and movies. I'm just saying put things in a nice tidy package and you never know what might happen.

Our BB carried unrated movies, they must have quietly changed the policy. I remember right after Snowdogs we wandered into BB and without knowing what it was about we picked up Showboat, which also starred Cubie Gooding Jr., my wife said she didn't see a rating, well we all sat around the TV and the kiddies had the popcorn, popped in the movie and bare naked breasts were showing right in the menu, so needless to say that got ejected quickly.

I personally wouldn't think streaming would be that big but that's based on how I do things. I guess people like the Netflix version well enough. But I didn't think mailing the movies would catch on either, so my crystal ball has static

[Worf101]

There is no such thing as a movie "that every other rental place" carries. Name a title that EVERY other video store carries that Blockbuster purposely excludes.

Unh Wooch, to be fair I ran into this a few years ago with a title in BlockBuster. I wanted to rent Sir Ben Kingsley's "Suspect Zero". It had been out for quite some time however my local BB decided that it was inappropriate and didn't get it for months later. Why I don't know. They also got "downrated" neutered versions of "Team America" and "Dirty Rotten Shame" because of explicit puppet sex and other things. So BB did/does put it's morals on my mind when there, not so with netflix.

Da Worfster

[Groundbeef]

Why I don't know. They also got "downrated" neutered versions of "Team America" and "Dirty Rotten Shame" because of explicit puppet sex and other things. So BB did/does put it's morals on my mind when there, not so with netflix.

Da Worfster

You are into some freaky stuff.

[Woochifer]

Wooch, I'm saying that movies will have commercials. It's going to take some special arrangement to get this going for new releases, but Hulu is already showing older movies this way.

Remember that those older movies have already gone through their revenue windows for the theatrical run, DVD release, broadcast release, and PPV release. The studios have already pocketed the major revenue streams. There no advertising deal out there big enough to make up for those revenues on a new release. It's wishful thinking to presume that a studio will just upload a $100 million movie production onto the internet, and get more revenue through advertisements than a theatrical and home video release.

If anything, the future of video streaming very well might be tied to cable/satellite subscriptions. There are talks right now of integrating sites such as Hulu into a "TV Everywhere" initiative where the major broadcast channels will stream all of their content
online, but only provide full access to those who subscribe to those cable/satellite service. The article below indicates that the major networks are looking at how online services for music and newspaper content have fared financially, and don't like what they see. Last thing they want to do is undermine their current financial base.

http://www.tvweek.com/news/2009/03/t..._as_pay_fo.php

As far as the AppleTV setup, it's actually just a software install. But I think what's much more likely to make all happen is when set-top boxes, players, DVRs, and cable boxes can run a web browser without restrictions. That's just around the corner and is going to change this whole discussion.

Have you ever tried to use a web browser from within a set-top box? I've done that with a PS3, and it's convoluted and cumbersome trying to do anything using either a game controller or remote. An average consumer wants something that will work with a simple remote, not something that's optimized for a keyboard and mouse.

I'm also not calling BR an outmoded physical technology. BR is very succesful right now, and that's just fine, it is what it is. What I am saying is that downloads and online streaming are much more popular than sales figures would suggest. With online content, it's much more about quantity than value, and that's an equation that lends itself much better to an advertising-driven business model, even if that's not to my liking (which it isn't), but it is what it is.

And I'm saying that until downloads and streaming services can demonstrate a clear path to financial viability, it will only continue to work on the fringes and serve a niche audience, while the audience and revenue continue to come from broadcast and media sales. If anything, Hulu is basically a 24/7 infomercial for NBC Universal's programming, because shows that NBC put on Hulu have managed to increase their broadcast audience.

[Woochifer]

Unh Wooch, to be fair I ran into this a few years ago with a title in BlockBuster. I wanted to rent Sir Ben Kingsley's "Suspect Zero". It had been out for quite some time however my local BB decided that it was inappropriate and didn't get it for months later. Why I don't know. They also got "downrated" neutered versions of "Team America" and "Dirty Rotten Shame" because of explicit puppet sex and other things. So BB did/does put it's morals on my mind when there, not so with netflix.

Da Worfster

The question is whether that purchasing decision was implemented across the entire chain, or if it was a store or regional manager that made the call.

I recall that Team America was an R-rated movie, and the DVD was also available in an "unrated" version. The R-rated version is the actual theatrical cut, and Blockbuster's policy is that they do not order the "unrated" versions. It's not really a "downrated" version they ordered, given that the R-rated version is what played in theaters. It's more the case that the unrated version is "uprated."

[nightflier]

Wooch, someone told me today that there is actually a TV available with Hulu built-in. The person didn't know which brand, but that ought to change things.

Regarding the PS3 running a browser, I wonder if all that difficulty isn't tied to Sony's obsession with protecting their other sources of revenue. They certainly aren't beyond hobling product to protect other product lines, after all. Maybe they see unfetered web access as a threat?

I also disagree with the whole argument that a revenue stream makes a product viable. That's the same line of thinking that the record companies tried to hang onto when they did everything they could to kill music downloads. And they are still at it, suing old grannies and young teen-agers as well as less insidious reactions like trying to kill Apple's efforts to lower prices and increase DRM-free selection. The fact is that no protectionist business model can compete against technological progress. Technology always wins.

I know it's discomforting to think that the business model we've become so accustomed to is being challenged and could very well go away alltogether. But that's the effect of technology. Napster, for all it's evil, changed the music industry permanently, and the record companies still don't know how to make the same amount of money that they did with physical media. Maybe they won't make those kinds of proficts anymore. In a retracting economy, this is entirely possible. I'm going to guess that the movie industry is in for the same change.

[Rich-n-Texas]

Wooch, someone told me today that there is actually a TV available with Hulu built-in. The person didn't know which brand, but that ought to change things.

Only if it's really true. A Google search returns nothing indicating there's a TV with built-in Hulu. Nothing in Wikipedia either. Sounds kinda far-fetched to me anyway...

[nightflier]

I'll find out what the real story is. Maybe it was just wishful thinking on their part.

[Feanor]

... over what is a matter of taste or habit.

I won't miss BB at all. Selection too limited, prices too high for either rentals or purchase. Virtually eveytime I've walked in ...

• If I have a particular film in mind, they either don't carry it or it's out
• If I hope to browse and spot something, I can't find anything worth the rental cost or time to watch. (OK, my indecisiveness is a problem here.)

I'm not an instant gratification guy, so neither BB or pay-for-download are appealing versus the slow but steady Netflix/Zip.ca approach. Zip.ca solves three problems for me; (1) they have a huge selection; (2) I don't have to decide to watch movie A vs. movie B tonight, I just put both on my Zip List; (c) their rental price is right.

[pixelthis]

Only if it's really true. A Google search returns nothing indicating there's a TV with built-in Hulu. Nothing in Wikipedia either. Sounds kinda far-fetched to me anyway...

All you have to do is plug your computer into your TV.
I watch HULU on my 42" all the time, with my outboard sound card sending the sound to my system.
No big thang really.

[pixelthis]

There was a news report (forget where) where a guy canceled his cable, now he watches all of his shows off of the web.
Said that he didnt really see paying for cable when all of his shows could be gotten off of the web for free.
Wave of the future, wave of the future

[nightflier]

Well it turns out that the Hulu TV wasn't a commercial product after all, it was a hack using the Samsung A750, I believe. But I did run across this web page with some interesting info:

http://www.inquisitr.com/14621/the-f...et-tv-roundup/

I think that the real issue isn't technology but some lisencing nonsense. In that case, I'm betting on the technology winning out. Let's hope so. All people want is a TV that can browse the web with a simple remote-controllable interface (not a keyboard). All the pieces are there, it's just a matter of enough hacking to occur so that the manufacturers have no choice but to give the people what they want.

[pixelthis]

Well it turns out that the Hulu TV wasn't a commercial product after all, it was a hack using the Samsung A750, I believe. But I did run across this web page with some interesting info:

http://www.inquisitr.com/14621/the-f...et-tv-roundup/

I think that the real issue isn't technology but some lisencing nonsense. In that case, I'm betting on the technology winning out. Let's hope so. All people want is a TV that can browse the web with a simple remote-controllable interface (not a keyboard). All the pieces are there, it's just a matter of enough hacking to occur so that the manufacturers have no choice but to give the people what they want.

You're going to need a keyboard.
INTERNET has to happen in order for the dream of interactive tv to become a reality.
Its basically VOD, interactive TV, and online shopping all in one.
This is a major sea change, one that is probably going to be accelerated by the current unpleasantness.
NETWORK TV IS dead(dying as we speak)
CABLE COMPANY, the new internet service provider
OTA (over the air) how your computer talks to the web, how your ambulance company
talks to its ambulances, what old codgers sigh and fondly recall as "free TV".

[Woochifer]

Wooch, someone told me today that there is actually a TV available with Hulu built-in. The person didn't know which brand, but that ought to change things.

For now, it's primarily set-top boxes that are trying to integrate online services such as Hulu into their products. But, the cautionary tale is that the content providers hold all the cards. I was just reading about how some set-top box manufacturer had been touting its integration with Hulu, but talks with NBCU about licensing fees broke down and Hulu access got cut off to that company's set-top boxes.

Hulu is a proprietary service, with NBCU holding all the keys. They let people embed content and play movies/TV shows over set-top boxes because they ALLOW it. Hulu's MO over the past year has been to grab as many eyeballs as possible, and spread content as far across the web (and set-top devices) as possible. They've got one of the bigger audiences on the web, and you can bet that they're now looking to cash in. If you start seeing Hulu access on TVs, it will be because the manufacturer is paying for it.

And if that TV Week article I posted is true, you can bet that they're also looking to milk the cable/satellite companies as well. If that "TV Everywhere" initiative is successful, then you'll start seeing more of the content behind a subscription wall.

Regarding the PS3 running a browser, I wonder if all that difficulty isn't tied to Sony's obsession with protecting their other sources of revenue. They certainly aren't beyond hobling product to protect other product lines, after all. Maybe they see unfetered web access as a threat?

Why is it always some conspiracy with you for a company to want to make a profit from what they develop and manufacture?

The PS3 web browser is a PITA for one simple reason -- a game controller (or Bluetooth remote) is a poor substitute for a keyboard and mouse. Web browsers are built around keyboards and mice, and most web content is optimized around browsers. That's the same reason why every effort to integrate web browsing with TVs has failed. Simple as that.

I also disagree with the whole argument that a revenue stream makes a product viable. That's the same line of thinking that the record companies tried to hang onto when they did everything they could to kill music downloads. And they are still at it, suing old grannies and young teen-agers as well as less insidious reactions like trying to kill Apple's efforts to lower prices and increase DRM-free selection. The fact is that no protectionist business model can compete against technological progress. Technology always wins.

There's been plenty of technologies that have failed precisely because they had no revenue stream. If Hulu does not have a means of making money (whether directly or indirectly), then why exist at all? Hulu is less about technology than about marketing media content. And producing that content costs money.

Right now, Hulu is loaded with "free" content because NBCU is trying to build up the audience numbers. Plus, it's promotion for network viewing, which IS supposed by ad dollars. Hulu would not even exist if not for the fact that NBCU owns both the content AND the distribution.

Once they get people hooked and build up the audience, then you bet they will try to make money off of it by walling off portions of it exclusively for subscribers and/or cable/satellite users. This is no different than when websites like Match.com were free for a while, until they built up huge numbers of users and converted the site into a subscription service.

I know it's discomforting to think that the business model we've become so accustomed to is being challenged and could very well go away alltogether. But that's the effect of technology. Napster, for all it's evil, changed the music industry permanently, and the record companies still don't know how to make the same amount of money that they did with physical media. Maybe they won't make those kinds of proficts anymore. In a retracting economy, this is entirely possible. I'm going to guess that the movie industry is in for the same change.

The part that you're overlooking is that producing TV programs and movies costs money, and lots of it. This isn't like the music industry where recordings can be independently produced and distributed on relatively low budgets.

Even low budget indie movies made with digital HD camcorders will cost more than an average year's salary just to produce (unless you believe that everybody should work for free). No matter how the distribution technology advances, the bottomline remains that a revenue stream from somewhere has to recoup the investment made in the production costs. If you cut out the most lucrative revenue sources in favor of a far less lucrative source, then how do you pay for productions in the pipeline?

Ad-supported sites like Hulu only work because NBCU is willing to subsidize the startup costs, and use the site as an infomercial for their broadcast programs (where the bigger money is made). At some point down the road, they will most definitely explore ways of making money off of the site, since they control the content.